An inspection contingency is a clause in a homebuying contract that provides a buyer cause to abandon the transaction if an inspection reveals a material defect that was not part of the disclosures provided by the seller. Most states include an inspection contingency in their standard contracts, and those that don't generally provide some other mechanism for the buyer to back out in the event of something material being found during an inspection.
The inspection contingency is limited to a time period defined in the contract, often called an inspection contingency date.
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